Nobel Laureate economist Angus Deaton has delivered a ferocious rebuke to his own profession, saying economists have failed to understand that capitalism is about power.
Yep. From even before Adam Smith up through Marx, economics wasn’t really this separate discipline. The social sciences were interdisciplinary, and people who studied political economy understood it in a broader context.
But the “problem” was, those political economists (certainly Marx yes, but plenty others; Marx didn’t operate in a vacuum) started to draw some uncomfortable conclusions about capitalism. In comes the marginalist revolution and neoclassical economics. While a lot of these marginalist economists did go on to criticize Marx specifically (i.e. Bohm-Bawerk), really I don’t see the marginalist legacy as something that attempted to “debunk” Marx & co per se. More about ending political economy as a pursuit, and narrowing the focus of “economics” on things like government fiscal and monetary policy. Even in the “debate” between subjective and labor theories of value, I don’t think the SVT is even “wrong”, it just doesn’t tell us anything interesting. It basically says we’re not going to trouble ourselves with understanding the bigger things, we’re just gonna say that wherever price and quantity intersect in a stable situation is “equilibrium”. Killing political economy was what capital needed to get people to stop questioning the economic system and instead focus this new “economic” science on how to be a tool for capital.
Yep. From even before Adam Smith up through Marx, economics wasn’t really this separate discipline. The social sciences were interdisciplinary, and people who studied political economy understood it in a broader context.
But the “problem” was, those political economists (certainly Marx yes, but plenty others; Marx didn’t operate in a vacuum) started to draw some uncomfortable conclusions about capitalism. In comes the marginalist revolution and neoclassical economics. While a lot of these marginalist economists did go on to criticize Marx specifically (i.e. Bohm-Bawerk), really I don’t see the marginalist legacy as something that attempted to “debunk” Marx & co per se. More about ending political economy as a pursuit, and narrowing the focus of “economics” on things like government fiscal and monetary policy. Even in the “debate” between subjective and labor theories of value, I don’t think the SVT is even “wrong”, it just doesn’t tell us anything interesting. It basically says we’re not going to trouble ourselves with understanding the bigger things, we’re just gonna say that wherever price and quantity intersect in a stable situation is “equilibrium”. Killing political economy was what capital needed to get people to stop questioning the economic system and instead focus this new “economic” science on how to be a tool for capital.